Story image

Two Auckland mobile traders fined $171,500 for contract failing

16 Jun 16

Two mobile traders have been fined $171,500 in the first sentencing under the strengthened Credit Contracts and Consumer Finance Act 2003 laws.

Goodring Company was fined $98,000 for breaches while Betterlife Corporation was fined $73,500.

The two Auckland companies sell consumer goods, including electronics, on credit at ‘significantly’ higher prices than mainstream stores. One Betterlife customers purchased an iPhone 5C for $2401, when the Commerce Commission says the phone typically retails for around $600.

As reported by ChannelLife in April, the traders pleaded guilty to the charges brought by the Commerce Commission.

Goodring plead guilty to 28 charges while Betterlife plead guilty on six.

The Commerce Commission says both companies failed to provide borrowers with the legally required information and the information was also not provided in a clear and concise way, as required by the Act, which was strengthened last year.

In sentencing in the Auckland District Court, Judge Sharp said both companies terms and conditions suffered from ‘serious and significant deficiencies’ and accepted that they would have been extremely difficult or impossible for the debtors to read or understand.

Mary-Anne Borrowdale, Commission general counsel, says the Commission regarded the conduct of Betterlife and Goodring as serious because of the deficiencies in their loan contracts.

“Although the penalties given in this case were more than previously, we are considering whether they are adequate to address the non-compliance that we are seeing,” Borrowdale says.

She warned that the consumer watchdog has a ‘good number’ of other court cases and 14 ongoing investigations into mobile traders underway..

“These companies sell high priced goods to vulnerable consumers on credit in order to fund the purchase,” she says.

“We have found that a concerning number of mobile traders and lenders do not comply with the law, and we are taking action to change that,” she adds.

The Commission has prosecuted six mobile traders this year, including the latest two.

In February Flexi Buy was fined $50,000, with $3480 awarded in damages to customers. Ace Marketing plead guilty and is expected to be sentenced in July, while Macful International appeared in court this week on 21 charges. The sixth trader is yet to appear in court.

Commerce Commission report shows fibre is hot on the heels of copper
The report shows that as of 30 September 2018 there were 668,850 households and businesses connected to fibre, an increase of 45% from 2017.
Wearables market flourishing - fuelled by smartwatches
A market that has stuttered in the past now has a bright forecast as adoption of wearable technology continues to thrive.
The tech that helped the first woman to sail around Australia
Lisa Blair used devices from supplied by Pivotel to aid her in becoming the first woman to circumnavigate Australia non-stop.
Why there will be a battle for the cloud in 2019
Cloud providers such as AWS, Azure, and Google will likely find themselves in a mad scramble to gain additional enterprise customers.
Mercury Energy sells smart meter business for $270m
“Metrix’s large installed meter base, deep customer relationships and innovation platform, make this a natural acquisition."
IDC: Manufacturing, retail/wholesale biggest cloud spenders
"Industry cloud growth rates will continue to accelerate over the next three years, which is very unusual for multi-billion-dollar markets,”
Dell EMC embeds security in latest servers
Dell EMC's 14th generation of PowerEdge servers has comprehensive management tools to provide security across hardware and firmware.
Hands-on review: The Logitech R500 laser presentation remote
With a clever ergonomic design, you’ll never have to glance at the device, unless you deliberately look to use the built-in laser pointer to emphasise your presentation.